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SEVEN FAT YEARS

SEVEN FAT YEARS. According to Social Security records, 85 out of 100 Americans have less than $250 when they reach age 65. SEVEN FAT YEARS. Take up the fifth part of the land of Egypt in the seven plenteous years. Genesis 41:34

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SEVEN FAT YEARS

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  1. SEVEN FAT YEARS According to Social Security records, 85 out of 100 Americans have less than $250 when they reach age 65.

  2. SEVEN FAT YEARS Take up the fifth part of the land of Egypt in the seven plenteous years. • Genesis 41:34 That the land perish not through the famine. • Genesis 41:36

  3. SEVEN FAT YEARS Joseph Principle: Save during FAT years for lean years

  4. SEVEN FAT YEARS • Saving vs. Hoarding Genesis 41:46-57 Joseph saved 20% Luke 12:16-21 Rich man had to build bigger barns • How are these situations similar? • How are they different? • Why was God pleased with one, displeased with other?

  5. SEVEN FAT YEARS “…thou shalt lend unto many nations, and thou shalt not borrow.” • Deuteronomy 28:12b • Biblical definition of investing is to lend.

  6. SEVEN FAT YEARS Make Friends with Money “Make to yourselves friends of the mammon of unrighteousness.” • Luke 16:9 Educate yourself in money matters.

  7. SEVEN FAT YEARS Generational Numbers 48 Million “Mature” 81 Million “Boomers” 38 Million “X-ers” Previous Generation finances the retirement of present generation.

  8. SEVEN FAT YEARS

  9. Parents Income rose 524% (age 20-30) 49 workers support 1 retiree Average age at death 63 Peak earnings after kids gone Homes appreciated greatly (Buy Your Second Home First) Paid Debt with inflated $ You 34% 2.7 workers(2018) 90/95 still paying for kids 0-3% per yr. 1998 inflation 1.7% SEVEN FAT YEARS

  10. SEVEN FAT YEARSHow Much Do I Need? _____ 75% of gross _____ + adjust for inflation 4% per year _____ - subtract Social Security Earnings 1 (800) 772-1213 / www.ssa.gov _____ - Employer - Call Human Resource _____ - Gap Gap x 12 mo. Divided % return = savings needed. $2000 x 12 = 24000 divided 12% = 200,000

  11. SEVEN FAT YEARS $200,000 @ 12% 20 years = $911.21 $200,000 divided $911.21 = $219.49 per month amount need to save $200,000 x 12% = $24,000 Not using principal

  12. SEVEN FAT YEARS Three plans for making a million by age 65, assuming the money ears 12% a year • Age 25, start investing $59 a month • Age 40, put $10,000 down AND invest $493 a month • Age 50, put $50,000 down AND invest $1,540 a month

  13. Three Principles for Lean Years • Spend less than you earn - 5 to 20% • Pastor $8000 per year income • $1,663,000 liquid assets • Remember the cost of lost opportunity • Consider cost of making a mistake

  14. SEVEN FAT YEARS • 401 (K) - Modern Day Pension • 403 (b) • Employer Match • Move funds if job changes

  15. SEVEN FAT YEARS • 401(K) • 403(b) • ROTH IRA-no tax on earnings from IRA • IRA-no tax on contribution to IRA Vehicle for investment NOT the investment

  16. SEVEN FAT YEARS Current Contributions • Pre-Tax Deferral Percent 7% of pay • After-Tax Contribution Percent 0% of pay • YTD Employee Contributions $3,282.44 • YTD Company Contributions $4,274.63

  17. SEVEN FAT YEARS Balances as of December 31, 1998 • Your Contributions Since 1/1/88 to REVSOP: $20,861.94 • Your Total REVSOP Balance: $157,677.55

  18. SEVEN FAT YEARS Ways to invest IRA, 401(K), 403(b) • Cash- CD, Money Market • Annuity - contract with insurance co. • Mutual Funds • very conservative - money market • conservative - money market, bonds, stocks • moderate - income producing stocks, large cap stocks • growth - large cap stocks, mid-cap stocks • aggressive - small cap stocks

  19. SEVEN FAT YEARS $166 month automatic withdrawal = $2,000 per year $332 month = $4,000 per year for two

  20. SEVEN FAT YEARS 98 3yr 5yr 10yr Washington Mutual (5.75%) 18 24 22 18 1-800-421-4120 Am. Century Inc/Grth 27 29 23 1-800-345-2021 Legg-Mason Value 47 41 32 21 1-800-577-8589 Janus Twenty 75 43 30 26 1-800-525-8983

  21. Legg-Mason Value$10,000 Grew to $254,865 17yr

  22. SEVEN FAT YEARS

  23. SEVEN FAT YEARSUnderstanding Risk

  24. SEVEN FAT YEARS $1,000 Deposited Each Year End of Year Values 5 yrs 10 yrs 15 yrs 20 yrs 18% 7,154 23,521 60,965 146,628 20% 7,442 25,959 72,035 186,688 22% 7,740 28,657 85,192 237,989 24% 8,048 31,643 100,815 303,601

  25. SEVEN FAT YEARS Rule of 72 Divide 72 by rate of return = # of years to double money 72 divide 18% = 4 years 72 divide 15% = 4.8 years 72 divide 12% = 6 years

  26. SEVEN FAT YEARS $130,000 - 4 yr 260,000 Age 40 - 8 yr 520,000 Age 44 - 12 yr 1,040,000 Age 48 - 16 yr 2,080,000 Age 52 - 20 yr 4,160,000 Age 56 - 24 yr 8,320,000 Age 60 - 28 yr 16,640,000 Age 64

  27. SEVEN FAT YEARS BEGIN WITH THE NEXT PAY RAISE

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